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Senate Bill Report — SB 5515, As of January 13, 2022

Summary

A Senate Bill Report on SB 5515, as of January 13, 2022, an act encouraging economic growth by providing a state business tax credit for new employment positions in the hospitality industry. Senators Dozier, Holy and Padden are listed as sponsors. The bill creates a $275 business and occupation tax credit for full-time employees hired into the hospitality industry with annual wages exceeding the average wage for the county. The credit is earned for the calendar year a position is filled plus four subsequent consecutive years if the position is maintained, and is available only in areas where the unemployment rate is at least 25 percent greater than the statewide rate. The bill takes effect on July 1, 2022.

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Issuer
Congressional materials
Document type
Report
Date
2022-01-18
Case
2022 01 18 A29483 D237684 Bill Report 5515 Sba Bfst 22

Cite this document

“Senate Bill Report — SB 5515, As of January 13, 2022.” Original at app.leg.wa.gov, dated 2022-01-18. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2022-01-18-2022-01-18-a29483-d237684-bill-report-5515-sba-bfst-22/, SHA-256 638bca8764aaf6e04de14ed971b542f0fae66a2fe68c54bb0f205b652b4c27b6.

Full text

                            SENATE BILL REPORT
                                  SB 5515

                                      As of January 13, 2022

Title: An act relating to encouraging economic growth by providing a state business tax credit
     for new employment positions in the hospitality industry.

Brief Description: Encouraging economic growth by providing a state business tax credit for
     new employment positions in the hospitality industry.

Sponsors: Senators Dozier, Holy and Padden.

Brief History:
     Committee Activity: Business, Financial Services & Trade: 1/18/22.


                                     Brief Summary of Bill
           • Creates a $275 business and occupation tax credit for full-time
             employees hired into the hospitality industry with annual wages
             exceeding the average wage for the county.
           • Makes the credit only eligible in areas where the unemployment rate is at
             least 25 percent greater than the statewide unemployment rate.


SENATE COMMITTEE ON BUSINESS, FINANCIAL SERVICES & TRADE

     Staff: Clinton McCarthy (786-7319)

     Background: Business and Occupation Tax. Washington State's major business tax is the
     business and occupation (B&O) tax. The B&O tax is imposed on the gross receipts of
     business activities conducted within the state, without deduction for the costs of doing
     business. The B&O tax rate varies by classification of business.

     Business and Occupation Tax Credits. A B&O tax credit is allowed against the amount of
     tax otherwise due to the Department of Revenue (DOR). The state provides a number of




     This analysis was prepared by non-partisan legislative staff for the use of legislative
     members in their deliberations. This analysis is not part of the legislation nor does it
     constitute a statement of legislative intent.

Senate Bill Report                              -1-                                             SB 5515
     tax credits for B&O tax. The following are a few of the major B&O tax credits offered:
         • rural county B&O credit for new employees;
         • high technology B&O tax credit;
         • small business B&O tax credit;
         • multiple activities tax credit; and
         • credit for hiring unemployed veterans.

     Summary of Bill: A $275 B&O tax credit is created for full-time employees hired into the
     hospitality industry with annual wages exceeding the average wage for the county. The
     credit is earned for the calendar year an employer fills a position, plus four subsequent
     consecutive years if the position is maintained during that period of time. New positions
     eligible for the credit can be created only if a position vacated by an existing employee is
     filled by a new hire. When a position is newly created, if it is filled before July 31st, this
     position is eligible for the full yearly credit. If it is filled after June 30th, this position is
     eligible for half of the credit.

     The hospitality industry is defined to include:
        • accommodation services;
        • food services;
        • amusement and recreation services; or
        • any combination of these services.

     The credit may be accrued and carried over. No application is necessary for the credit, but
     the person must be able to verify eligibility with DOR for the credit. The credit is only
     eligible in areas where the unemployment rate is at least 25 percent greater than the
     statewide unemployment rate.

     The Employment Security Department is directed to provide DOR any information needed
     by DOR to verify eligibility for the credit.

     Appropriation: None.

     Fiscal Note: Requested on January 10, 2022.

     Creates Committee/Commission/Task Force that includes Legislative members: No.

     Effective Date: The bill takes effect on July 1, 2022.




Senate Bill Report                               -2-                                          SB 5515

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